You are here

White House will look 'very carefully' at Peugeot, Fiat Chrysler deal

nz_peugeot_021119.jpg
US President Donald Trump's administration will look very closely at the planned merger between Fiat Chrysler and Peugeot owner PSA, White House economic adviser Larry Kudlow said on Friday.

[WASHINGTON] US President Donald Trump's administration will look very closely at the planned merger between Fiat Chrysler and Peugeot owner PSA, White House economic adviser Larry Kudlow said on Friday.

The deal, announced on Thursday, would create the world's fourth-largest automaker.

"We will obviously look at it very, very carefully," Mr Kudlow said on Bloomberg. "The President has not commented on the deal ... We're not afraid of doing business with international companies, Lord knows."

When asked about the 12.2 per cent equity stake and 19.5 per cent voting stake that China's Dongfeng Motors holds in PSA, Mr Kudlow said: "With respect to the Chinese story, we obviously are alert and on guard."

The deal, which would be structured as a 50-50 merger, would create the fourth-largest global automaker with annual sales of nearly 9 million vehicles. Fiat Chrysler told employees the deal could generate synergies of 3.7 billion euros (S$5.6 billino) but added "these synergies are NOT based on closing plants."

Your feedback is important to us

Tell us what you think. Email us at btuserfeedback@sph.com.sg

Fiat Chrysler declined to comment.

There has been speculation Dongfeng might sell its holdings, which could help ease the deal's passage through US regulators, given US-Chinese trade tensions.

"We will welcome a good deal. We hope it will get more production in the United States, more factories and workers and employment in the US. And with respect to the Chinese angle, we will take a careful look at it," Mr Kudlow said.

Fiat Chrysler said on Thursday that "teams at both companies are working to finalise discussions and reach a memorandum of understanding in the coming weeks".

REUTERS

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes